Binance asked to pay a $150 million bribe
Troubled history with the Nigerian government
Nigeria’s continued war on crypto

In a blog on Tuesday, Binance CEO Richard Teng disclosed that the firm was approached by unknown persons asking for a large payment to make their problems “go away” in Nigeria. A New York Times article revealed that the company was given 48 hours to make a payment of roughly $150 million in crypto.

“As our employees were leaving the venue, they were approached by unknown persons who suggested to them to make a payment in settlement of the allegations,” Teng wrote about the incident which he said happened after a meeting with Nigerian government officials on January 8.

The Binance boss repeatedly demanded for the release of the crypto exchange’s compliance officer Tigran Gambaryan who has been held in Nigeria for over 70 days.

“My friend and colleague, Tigran Gambaryan, has been unlawfully detained by the Nigerian government for more than 70 days. We're tirelessly working to #BringTigranHome,” Teng posted on X.

Tigran Gambaryan, a U.S citizen heading compliance at Binance and alongside Nadeem Anjarwalla, Binance’s Africa regional manager were held by Nigerian security operatives on February 26th after a purported friendly meeting with regulators. While Anjarwalla escaped custody on March 22 to Kenya where he is a citizen, Gambaryan remained in custody as a defendant in money laundering suits against Binance.

“I also feel that it’s time to speak out about this issue on behalf of the global business community. To invite a company’s mid-level employees for collaborative policy meetings, only to detain them, has set a dangerous new precedent for all companies worldwide,” Teng wrote in the blog.

According to Teng, Gambaryan was formerly a Special Agent for the U.S. IRS before he was hired by Binance in 2021 to help the exchange build stronger compliance controls, subsequently assisting global law enforcement in freezing and seizing more than $2.2 billion worth of assets, including more than $285 million in cooperation with U.S. agencies like the FBI, DOJ and DEA.

“Tigran did not go to Nigeria as a ‘decision-maker,’ nor a ‘negotiator.’ He was merely acting as a functional expert in financial crime and capacity building in policy discussions,” the Binance CEO added.

A history mired in uncertainty

Teng claimed that in May 2022 Nigeria’s securities regulator (SEC) published regulations for digital assets, bringing cryptocurrency under its purview, but this regulation “failed to articulate some of the key licensing requirements (e.g. application process, licensing fees, etc.), making it practically impossible to apply for a license.” Binance, according to Teng, reached out to the regulator multiple times to offer practical guidance on the licensing process but to no avail.

On June 9, 2023, the SEC issued a warning to the Nigerian public about the activities of the Binance exchange and directed Binance to immediately stop soliciting Nigerian investors. Teng stated that Binance had not received any response from regulators. As a result, Binance promptly halted its solicitation activities in Nigeria, including advertising, events, and targeted communications to users, Teng said.

Securing Gambaryan’s release

Teng reiterated his commitment to securing Gambaryan’s release, citing the exchange’s decision to turn off its P2P product of the naira currency on the Binance platform. “Our hope when we took this drastic step was that our colleagues would be released and Binance could continue to work with the Nigerian government to resolve any further concerns. Unfortunately, that didn’t happen,” Teng said.

Teng said that Binance will continue to do everything to support Gambaryan, requesting that he should be allowed to go home to his family, pledging to work with Nigeria’s law enforcement to remove bad actors from its platform and with Nigeria’s Federal Inland Revenue Service on resolving potential historic tax liabilities.

“This crisis must come to a resolution quickly, and Tigran must be allowed to go home if we’re going to move forward,” he added.

Image: Binance CEO Richard Teng by Joseph Nair/Getty Images